Asian stocks fall further on Greek default fears

By IBT Staff Reporter On 10/03/11 AT 10:08 PM

Asian stocks extended losses on Tuesday from the previous day's steep declines as investors continued to flee from riskier assets on growing doubts over Greece's ability to avoid default, fuelling fears of global financial turmoil and recession.

Global stocks fell to a 15-month low on Monday, with financial shares hit hard on fears over the banking sector's exposure to euro zone sovereign debt.

Franco-Belgian financial group Dexia called an emergency board meeting after concerns about its exposure to Greece.

Oil fell more than $1 on Tuesday, pressured by the debt concerns and a stronger dollar. U.S. crude fell to an intraday low of $75.92 a barrel, while Brent crude fell to as low as $100.52.

The yen, often regarded as safe haven, hovered near a 10-year peak against the euro and held firm against the dollar.

Investor preference for safer assets accelerated flows into gold, pushing the market up 1 percent while copper tumbled 4 percent as investors dumped the industrial metal on worries over a slowdown in growth and turned to dollar holdings.

The market's overwhelming focus on Greece's financial woes overshadowed a better-than-expected reading from the U.S. Institute of Supply Management's September manufacturing index and a rise in construction spending, potential evidence that the U.S. economy can avoid a recession.

European policymakers met on Monday to discuss ways to leverage the euro zone's rescue fund and pressure Greece to implement agreed structural reforms.